SBP strictly monitoring speculation in currency market The News Javed Mirza Friday, September 27, 2013

KARACHI: The Acting Governor of State Bank of Pakistan (SBP), Qazi Abdul Muqtadir, has said that the fall in the value of Pak Rupee was because of the speculative based panic buying and added that SBP was taking stern measures to avoid such situation going forward. Talking to The News on Thursday, Qazi said that the SBP had meetings with the market stakeholders including the currency exchange agents and ‘convinced’ them to stop speculation, after which the value of rupee rationalized. He said that local currency would further stabilise as the central bank was strictly monitoring the market situation and there was no extraordinary demand of dollar, nor there any extra huge import payments. “Real purchasing of rupee is the same. Present market value of dollar is a product of panic in the wake of rumours and is unrealistic as well as unsustainable. We are very closely monitoring the situation and soon panic will wear off and matters should stabilise,” Qazi Abdul Muqtadir added. Qazi categorically said that there had been no ‘intervention’ on the part of SBP, but the market consolidated on its due course as it was an artificial and speculative hike in the value if dollar versus Pak Rupee. He said that there had always been some minor adjustments in the currency value, for instance there always were some pressure in the Haj season but soon forex would start pouring in the form of remittances ahead of Eidul Azha. To a question regarding IMF’s conditionality pertaining to zero intervention by SBP in free movement of Pak Rupee, the acting governor SBP said that it was a very old demand of IMF, but even if this had been the case, the local currency had taken a slide, and not such a plunge.